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Effect Size

from class:

Intro to Business Statistics

Definition

Effect size is a quantitative measure that indicates the magnitude or strength of a relationship or difference between two variables in a study. It provides information about the practical significance of the findings, beyond just statistical significance.

5 Must Know Facts For Your Next Test

  1. Effect size is an important complement to statistical significance, as it quantifies the magnitude of the observed effect.
  2. Common effect size measures include Cohen's d, Pearson's r, and eta-squared (η²), each with their own interpretation guidelines.
  3. Effect size helps determine the practical importance of a finding, which is crucial for making informed decisions and interpreting research results.
  4. Effect size is used in power analysis to determine the necessary sample size to detect an effect of a certain magnitude with adequate statistical power.
  5. Interpreting effect size depends on the context and the specific field of study, as what constitutes a 'small', 'medium', or 'large' effect can vary.

Review Questions

  • Explain how effect size is used in the context of 8.4 Calculating the Sample Size n: Continuous and Binary Random Variables.
    • In the context of calculating sample size for continuous and binary random variables, effect size is a crucial input. Researchers use effect size estimates to determine the minimum sample size required to detect an effect of a certain magnitude with a desired level of statistical power. By considering the expected effect size, along with the desired significance level and power, researchers can ensure their study has sufficient sample size to draw meaningful conclusions about the population parameters.
  • Describe the role of effect size in the context of 9.2 Outcomes and the Type I and Type II Errors.
    • Effect size is directly related to the concepts of Type I and Type II errors. A larger effect size decreases the probability of making a Type II error (failing to detect an effect when it truly exists), as it becomes easier to detect the effect with a given sample size. Conversely, a smaller effect size increases the risk of a Type II error, as more statistical power is required to reliably detect the effect. Understanding the effect size in the context of hypothesis testing helps researchers balance the tradeoffs between Type I and Type II errors and design studies with appropriate statistical power.
  • Analyze how effect size is used in the context of 12.2 One-Way ANOVA and 12.3 The F Distribution and the F-Ratio.
    • In one-way ANOVA, effect size measures such as eta-squared (η²) provide information about the proportion of variance in the dependent variable that is explained by the independent variable. This effect size metric is crucial for interpreting the practical significance of the ANOVA results, beyond just the statistical significance indicated by the F-ratio and p-value. Additionally, effect size is an important consideration in the use of the F distribution, as the F-ratio itself is a function of the effect size. Researchers can use effect size estimates to determine the minimum detectable effect size given the sample size and desired statistical power, or to calculate the required sample size to detect an effect of a certain magnitude.
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